AHIP On Health Care Reform Legislation

America’s Health Insurance Plans (AHIP) President and CEO Karen Ignagni released the following statement on proposed health care reform legislation:

“For health care reform to work, everyone needs to be covered and the growth in health care costs must be brought under control. Health care reform legislation that does not address underlying medical costs cannot be sustained. Unfortunately, this legislation will drive up health care costs by adding billions in new health care taxes and encouraging people to wait until they are sick before getting insurance.”

Areas of Concern within the Bill

Lack of Cost Containment:

– Does Not Bend the Cost Curve – Health reform legislation that does not address underlying medical costs cannot be sustained. Unfortunately, this legislation lacks a system-wide approach that would actually bend the cost curve downward.

– Pilot Programs – The legislation takes a very timid and limited approach to addressing ways to control costs and improve quality. The legislation needs to take bolder steps by implementing throughout the entire health care system innovative payment and delivery system models that will help move the nation away from reliance on a fee-for-service payment structure and incentivize performance improvement across the board.

– IMAC – The legislation will not provide the comprehensive oversight needed because it would exempt Medicare payments for hospitals, physicians, and other key services from review during the first five years.

– Medical Malpractice Reform – The legislation needs to protect doctors who follow established best practices and implement safe, accountable care models based on the latest scientific evidence.

– Comparative Effectiveness – Comparative effectiveness research needs to look at both the clinical and cost effectiveness of tests, treatments, procedures, and prescription drugs so that patients and their doctors can make the most informed health care decisions.

Premium Tax:

– The legislation imposes a new $70 billion premium tax that the Congressional Budget Office (CBO) has said will be passed on directly to patients. This will raise the cost of coverage for individuals, families, and employers.

Market Reforms:

– Weak Coverage Requirement – The legislation will encourage people to wait to purchase coverage until they are sick, which unfairly penalizes those who currently have coverage. According to CBO, 23 million Americans will remain uninsured once this bill is fully implemented.

– Age Rating – The new age rating requirements will cause premiums to increase for people under the age of 30 by more than 50 percent.

Medicare Advantage:

– Massive Medicare Advantage Cuts – The legislation imposes $200 billion in cuts to Medicare Advantage that will cause massive disruption for the more than 10 million seniors enrolled in the program. If these cuts are enacted, millions of seniors in Medicare Advantage will lose their coverage, and millions more will face higher premiums and reduced benefits.

(See AmericanHealthSolution.org for what AHIP is promoting as a solution.)

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